A Guide to Betting Exchanges
Betting Exchanges
In the last couple of years the traditional Sportsbooks have found competition from a new and different type of betting company, namely the Betting Exchanges. Betting Exchanges are simply platforms which enable you to bet against other fans, at odds that one of you sets and the other accepts. These exchanges result in the best betting options and normally the best odds.
When you bet on Betting Exchanges you are pitting your opinion against someone else's and that can lead to some great odds. In this section Compare Best Odds will open up the world of Betting Exchanges to you, we'll explain in more detail how they work and offer tips and advice to help you bet with ever greater skill and confidence.
Betting Exchanges - Backing and Laying Bets
With Betting Exchanges you can bet that something WILL happen, or that it WON'T happen. If you want to bet that something will happen, you back your selection at the best odds available. If you want to bet that something won't happen, you lay against it and set odds for somebody else to take.
To give a football example, imagine Arsenal are playing Blackburn in the Premiership. You're pretty confident that Arsenal will take all three points, so you back them with £100 at the best odds you can get (let's say in this example that's 2.3). These odds are offered by other betting exchange members who fancy Blackburn to cause an upset and if there is sufficient money being offered at 2.3 to pay you if you win, your bet will instantly be 'matched'.
If Arsenal win the game, you win your bet and will then receive £230 minus a small commission to the betting exchange. This represents your £100 stake, plus winnings of £130. If Arsenal lose or draw, you lose £100, but pay no commission.
If you don't like the odds available when you are trying to make a bet, you have the option of entering the odds you would accept in the hope that another exchange member will then offer them to you. Your bet will remain 'unmatched' until this happens. It's important to be patient because the odds available to you often improve nearer to the start of the event as interest and betting activity in the markets increases.
What if you want to lay a bet? Rather than bet on Arsenal to win the game, you can lay against Blackburn winning, offering odds to other betting exchange members who disagree. Let's say in this example, the best odds available for Blackburn not to win are 3.65. If you lay £100 at these odds and Blackburn lose or draw the match, you would win £100, less commission. If Blackburn win the game however you would lose £265.
Betting Exchanges - How Odds Work
There are two main types of odds used in betting, there's the conventional Fraction odds and there's Decimal odds. To be successful while betting online and particularly at Betting Exchanges, it's important to understand how these odds work and what the differences are between them.
The more conventional Fixed odds are fairly easy to understand. Lets say Bolton are 4/1 to beat Chelsea, what that means is if you bet £1 you would collect £4, plus your original stake of £1 if Bolton wins. Betting £1 at 4/1 odds you would collect £5 in total.
Decimal odds may look a bit strange if you're used to Fixed odds, but once you've used them, we think you'll find that they're a lot easier to work with. Decimal odds are used all the way around the world, with the UK being one of the few countries where Fractional odds are still used.
To work out your potential returns with Decimal Odds, you simply multiply your stake by the Decimal odds. So if you were betting £10 at odds of 1.5, your return would be £15. That's £5 of winnings plus your original stake of £10.
If you want to compare both types of odds then to convert Decimal odds into Fractional odds, just subtract 1 from the decimal odds figure. In the above example, subtracting 1 from 1.5 would give you 0.5/1 - more commonly expressed as 1/2. You can use the table below if you want to convert.
KEY: Decimal - White, Fractional - Blue
| 1.10 | 1/10 |
| 1.73 | 8/11 |
| 3.50 | 5/2 |
| 1.13 | 1/8 |
| 1.80 | 4/5 |
| 3.60 | 13/5 |
| 1.14 | 1/7 |
| 1.83 | 5/6 |
| 3.75 | 11/4 |
| 1.17 | 1/6 |
| 1.91 | 10/11 |
| 4.00 | 3/1 |
| 1.20 | 1/5 |
| 2.00 | Evens |
| 1.33 | 10/3 |
| 1.22 | 2/9 |
| 2.10 | 11/10 |
| 4.50 | 7/2 |
| 1.25 | 1/4 |
| 2.20 | 6/5 |
| 5.00 | 4/1 |
| 1.29 | 2/7 |
| 2.25 | 5/4 |
| 5.50 | 9/2 |
| 1.36 | 4/11 |
| 2.50 | 6/4 |
| 6.50 | 11/2 |
| 1.40 | 2/5 |
| 2.63 | 13/8 |
| 7.00 | 6/1 |
| 1.44 | 4/9 |
| 2.75 | 7/4 |
| 7.50 | 13/2 |
| 1.50 | 1/2 |
| 2.88 | 15/8 |
| 8.00 | 7/1 |
| 1.53 | 8/15 |
| 3.00 | 2/1 |
| 8.50 | 15/2 |
| 1.57 | 4/7 |
| 3.20 | 11/5 |
| 9.00 | 8/1 |
| 1.62 | 8/13 |
| 3.25 | 9/4 |
| 9.50 | 17/2 |
| 1.67 | 4/6 |
| 3.40 | 12/5 |
| 10 | 9/1 |
Betting Exchanges - More Players = More Bets = More Money
Liquidity is everything when it comes to Betting Exchanges, the more 'liquid' a market is, the more money there is in it and when that relates to Betting Exchanges, it means the more chance there is of you finding a match for your bet. This is why you can find some great odds in Betting Exchanges and it's what should make Betting Exchanges a key part of your online betting strategy.
To give you an example of Betting Exchange liquidity, at Betfair every month, 100,000 of their customers place bets. At peak, they match up to 15,000 bets a minute from members in 85 countries.
As mentioned above, as more and more people join Betting Exchanges, the liquidity grows and grows, offering you even greater betting opportunities.
Betting Exchanges - Large Choice of Markets
Everybody has their favourite sports that they like to bet on and unsurprisingly the traditional betting sports of Football, Horseracing, Cricket and Golf are also the most popular sports on the Betting Exchanges. However we think you'll find the range of markets that you can bet on to be pretty amazing, that's the beauty of the exchanges, virtually every sport imaginable is covered.
If you can't find the event you're after, which will be some achievement, then with most Betting Exchanges you can just contact them with your suggestion and more often than not you'll get your request up. There's also a lot more on the Betting Exchanges than sport, you can bet on award ceremonies like the Oscars, on stock market indices, on political elections and on who will win big TV events like Big Brother or X-Factor.
Betting Exchanges - In Play Betting
With so many markets to choose from, you don't even have to make up your mind before the game starts! If you like the challenge of betting on a market that's changing by the second, you've got to try in-play betting. It's all the rage at the moment. In-play betting is becoming the most exciting way to bet, as it allows you to back or lay an outcome as the game itself is taking place. As always with Betting Exchanges, you're betting against other punters, with the odds changing rapidly as the action unfolds. There are three main advantages:
A great example of in-play betting that shows just how exciting it can be was seen on Betfair in the 2003-2004 Football Premiership season. The setting was Highbury, the match Arsenal vs Middlesbrough. And the stakes were high. A win or a draw for Arsenal would see them equal Nottingham Forest's record run of 42 unbeaten games - and at a miserly 1.25 to win, Arsenal were seen as virtual certainties. When Henry scored first and the odds narrowed to 1.13, that view seemed to be confirmed. But if you had logged on to bet on this game in-play, the excitement was just starting, first, Middlesbrough equalised, and the odds for an Arsenal victory eased to 1.57 then Boro scored again and then again. In less than thirty minutes, the score had gone from 1-0 to 1-3, and the odds on an Arsenal victory from 1.13 to 9.0 (8-1).
If you had still believed in an Arsenal fightback then you'd have had to move pretty fast because in minutes Arsenal had pulled a goal back, and the odds started tumbling. Two more goals from Arsenal took the score to 4-3 ,with the odds on a home victory now down to 1.2 and with Boro a huge 70.0 to win,and another Henry goal wrapped up the match, sending the odds to 1.01. Game over and for in-play betters, finally to catch your breath.
This example helps explain why few forms of betting can match the sheer excitement of in-play. In-play betting also relies on Liquidity to truly provide a fun experience, you need lots of people in the exchange, which means there's more money available to match your bets. And with odds changing so rapidly throughout an event, getting your bet matched quickly makes all the difference.
Betting Exchanges - How do they make money?
Betting Exchanges make their money via commission, which you pay when you have won on a market. If you are a net loser on a market (however many bets you have) you pay no commission. If you are a net winner on a market, you pay a commission on your winnings.
Betting Exchanges - Guaranteeing a Profit
Betting on exchanges is not all about winning or losing depending on a particular result. I know it sounds too good to be true but If you are knowledgeable, focused and quick enough you can often guarantee yourself a profit, whatever the outcome of the event you're betting on. You can do this by 'trading a position' and here's an example of how it can work for you.
It's Friday and you're betting on a horse race that's taking place the next day. You have a feeling that 'My Monty' can overcome some poor recent form and win - so you back it the day before the race at 20.0 for £100. Then a newspaper tipster makes the same prediction. Money floods in and the odds on 'My Monty' shorten to 10.0
This is your opportunity. You lay (i.e. bet against) 'My Monty' at 10.0 for £150. Then sit back and watch the race with a smile on your face. Because you can't lose...
If 'My Monty' romps home in first:
You win £1,900 for backing him
You lose £1,350 for laying him
Your net profit is therefore £550 (minus commission)
If 'My Monty' falls or is beaten for pace:
You lose £100 for backing him
You win £150 for laying him
Your net profit is therefore £50 (minus commission)
So to be able to guarantee a profit you need to keep your eye on the odds and to be prepared to move quickly when they go in your favour, but that's what sharp betting is all about.
